Great Service Begins At The Top

August 15th, 2017

 

If you aspire to or are a pre-eminent global service business, shouldn’t the CEO’s communication and feedback systems with its’ customers reflect its’ pre-eminence and branding? Here is a recent example of personal response times from constructive customer service letters to European CEOs:

3 days, in person Ewan Venters, CEO of grocer, Fortnum & Mason

14 days, in person Nigel Wilson, CEO of insurer, Legal & General

135+ days, zero response Dame Carolyn McCall, CEO of budget airline, easyJet

645+ days, zero response Keith Gibbs, CEO of insurer, Axa PPP Healthcare

795+ days, zero response Rickard Gustafson, President and CEO of airline, SAS Group

Letter writing might be unfashionable in certain quarters but when a customer today makes the effort to put pen to paper, it is a common sense assessment that they are serious about their intent to point out a superior or underwhelming experience. Based on my anecdotal research, a great experience buying a tin of biscuits will elicit a 4x faster response from the CEO than buying a cumbersome life insurance policy, 45x faster response from the CEO than being stranded late night in a desolate European airport or 219x faster response from the CEO to acknowledgement of proactive service in a healthcare insurer! Why would a CEO’s office operate like that unless it is seriously disorganised, it doesn’t hold itself accountable for the promises it makes to its’ customers or it is simply arrogant?

© James Berkeley 2017. All Rights Reserved.

 

Wealth Managers Day Of Reckoning

July 28th, 2017

 

The need for financial advice is at unprecedented levels, what is being increasingly exposed is the “competency and passion deficit” in many private wealth advisory firms. With greater complexity and ambiguity in their private clients’ lives, there is an increasingly unmet need for both increased “speed” (real-time decision-making) and higher “quality” (better performance, lower cost) resources. You cannot achieve that without new thinking, abandoning irrelevant activities and new approaches to regulation and compliance. A great many market practitioners question the sustainability of the robo-adviser retail advice model (Betterment, Wealthify and others) on account of their client acquisition costs but what is undeniable is that without old thinking and systems, they have a huge advantage for those seeking low-cost advice. For small and mid-market firms, who pride themselves on traditional advisory propositions, I confidently predict the next 12 months in N. America and Europe will see record consolidation and exits. The real question for the owners of these businesses, is the shortest route to your “ideal future” a friendly merger or sale now or driving on further into even more hazardous conditions with close to zero visibility?

© James Berkeley 2017.

 

A Time And A Place

July 27th, 2017

 

What is the price of privacy and silence in a workspace? Money and demand are abundant from small medium enterprises wanting more flexible offices, and investors hurtling after them with bags of moolala. WeWork, the co-working giant, announced today that it has raised $500 million from SoftBank and Hony Capital to fuel its growth in China. I am helping another ambitious group charm professional investors with their Mandarin Oriental-style idea and secure north of a $100 million backing. Indeed, I write this sitting in my own upscale serviced office located in the heart of London’s West End.  Yet there is one drawback that almost all of these co-working/serviced office operators have not properly addressed. Co-working is great until you want privacy and silence. You struggle like hell to find it. Hip canteen or dining areas, noisy club lounges, and expensive, clunky meeting rooms with time-consuming booking systems don’t provide real-time access to the seamless professional environment and image that your most discerning clients expect. Perhaps in a techie world but sorry, not in a professional services or financial services firm. It is like asking an Englishman to adhere to a relaxed dress code at a wedding, it is carnage. I am sorry but I neither want to work in or be seen as an underpaid HR manager ghosting in a Starbucks mid-morning. Whether we like it or not, informality in a business setting has its’ limits on how we think about ourselves, our productivity and our profit.   The operator, who can truly provide a workspace with “flexible” privacy and silence is really the one to throw serious money at.

© James Berkeley 2017.

New Balls, Please

July 12th, 2017

Today’s Wimbledon: strawberries and cream. White tennis gear. Polite ticket queues. Live streaming. Rafa, Roger, Andy, Novak, Serena and co. The sliding roof.

Days of old: more strawberries and cream. Wooden rackets. Bjorn, Jimmy, BigMac, Pete, Andre, Rod, BillyJean, Monika, Martina, Steffi. Intermittent rain delays. Images that are indelibly linked in our minds to a time and place. Yet a (sporting) institution and participants that has successfully embraced reinvention.

When you look at your own personal and business reinvention, what are the strongest images in the minds of your key constituents (clients, investors, employees, business partners and so forth)? Does it say more about your “past” value, your “present” value or your “future” value? Perception is reality. What are you doing regularly to adjust others perception of you? (new interests, new relationships, new ideas, new surroundings, new images etc.) Is it bold enough for your current and future circumstances? (changes in technology, competition, market needs, client experience, and so forth)

Why wait for the umpire’s cry of “new balls, please”, when you can better control your own destiny?

© James Berkeley 2017.

 

Inconvenience Squared

July 10th, 2017

Sitting on a EasyJet plane last night in Nice’s Côte d’Azur Airport minutes after boarding and the Captain gets on the microphone apologising that due to inclement weather on route, we must wait 55 minutes on the tarmac in Nice because “he needs to free up the gate”. He then invites those who would like to look around the cockpit to pay him a visit when the engines are off.

Kudos for the leader of the ship for addressing the audience and his openness to entertaining the frustrated passengers (quite how that is squared with EU security protocols preventing access to the cockpit is something of a mystery). Yet the obvious thing to ask is why would you ask 170 customers to be inconvenienced to a great extent in boarding a plane that you know is going nowhere for a considerable amount of time? Why couldn’t you move the plane 200 metres to another stand?

Perhaps you don’t care or perhaps the airline’s priority is more important than that of its’ customers comfort?  I see the same thing in a number of businesses.  Think about the unnecessary inconveniences that you are asking your customers to tolerate for your benefit? What stops you changing your behaviour and applying common sense? Is it a material or immaterial reason (safety or Company Policy)?

Too often our best intentions to manage customers expectations are largely overlooked because we insist on dumb decisions which are clearly not in our clients’ best interests.

© James Berkeley 2017.

 

Nothing But The Truth

July 5th, 2017

Beware the tendency today to have opinions proferred by eminent people confused with facts by trusted media sources.

Today, the BBC’s Kamal Ahmed in a story about the growth of the UK’s gig economy, quotes Lord Adair Turner, a British economist and policy adviser, as “correct” in expressing his opinion that the failure to see a real rise in average UK wages since 2007 proves that the capitalist system is not living upto its’ promise to “raise all boats over a decade”.

The capitalist system promises to create an environment for maximising wealth creation. There is no better system at doing that. It doesn’t “promise” anything other than in fostering competition, there will be winners and losers.

A capitalist economy’s fault line comes in how it deals with both groups and how it distributes wealth fairly and equitably. Should a public company CEO earn 10x that of a brain or heart surgeon who saves lives or 300x their lowest paid employee? I happen to believe everyone, who is seriously intent on working, and contributing to society, should be able to have a job.

Where we are on unsafe ground as a society, is when prominent journalists with dominant global media platforms don’t self-check opinions expressed as facts. For who are we to believe?

© James Berkeley 2017.

 

Nicky Haslam

June 30th, 2017

A detour last night to The Pheasantry in London’s Kings Road. Once a somewhat decadent bar in the 80s, now part Pizza Express restaurant and home to an intimate basement jazz club. The reason a charming evening with Nicky Haslam, supernova interior designer, to hear his take on classic Cole Porter and the 30s and 40s chanteuse, Lee Wiley. Accompanied by the renowned pianist, Tom Wakeley, Nicky exudes wit, charm and wonderful renditions of songs a great many people under 50 have rarely heard. He possesses that rare skill of drawing you into his stories without looking like his trying. Highly recommended.

© James Berkeley 2017.

The Entrepreneur’s Uncommon Legacy

June 30th, 2017

90% of entrepreneurs want to leave a powerful and lasting legacy upon the successful transition of their business, yet most fail. I define “legacy”, in a business context, as a framework within which decisions are made today about sustaining the beliefs that will enable the business to thrive in the future.

Failure is not in my experience down to the most obvious reason (renouncing control) rather it is the absence of people, long before the sale of the business is concluded, with the skills and volition to implement the entrepreneur’s desired legacy in the real world, and constant procrastination. Here is a simple checklist for the Entrepreneur:

  1. What would a successful legacy look, feel, touch, smell, taste like to those who are important to you and in what realistic timeframe?
  2. Whose support must you command upfront (exemplars, key influencers) to sustain it?
  3. What specific goals are you trying to accomplish internally and externally (e.g. improve succession planning, more impressive innovation, heighten customer awareness of societal issues etc.)?
  4. What elements need tackling first (e.g. strengthen career development, prioritise resource to performance improvements not fixing problems, identify exemplars etc.)?
  5. What must be done tomorrow and the day after?
  6. By whom and by what deadline?
  7. Do it.

If you need additional expertise, hire it. One of the biggest mistakes is the assumption that the content knowledge your coterie of existing advisers and top managers have about the inner workings of the business is sufficient to succeed. Here is the litmus test for the Entrepreneur:

  1. Do my key people possess a high, moderate or low level of familiarity with my legacy?
  2. Do my key people possess a high, moderate or low level of clarity about my legacy?
  3. Do my key people possess a high, moderate or low level of skills to implement my legacy?

Better to have started early, tried and failed than for the entrepreneur to look back with regrets about the mistakes that were made by not being bold enough or making it your priority, before the business was sold.

© James Berkeley 2017.

A Bad Day

June 29th, 2017

Most people’s so-called “bad day” is very rarely bad. With extremely rare exception, no one has been shot at, no one has been injured nor have they died. Let’s keep a sense of perspective and positive self-talk about own lives, our family, our business, our clients and our investors. Yes, it may be frustrating, the key investor, customer or prospect rejected an offer we made, the Board aren’t supportive of our great idea or our ability to move with haste has been hindered by others’ procrastination. These things happen. They are mere speed bumps. They are not catastrophic unless you allow them to control your mindset.

© James Berkeley 2017.

Lifting The Cloak Of Private Equity Secrecy

June 26th, 2017

 

 

How do you tell whether a private equity investor is “absolutely credible”? Realised investments, success stories, lists of co-investors, testimonials, references etc. are all valuable but can I actually see their intellectual property? I am referring to the availability of tangible communications (articles, presentations, models, audio, video etc.) encapsulating the investor’s best ideas, experiences, education, managing cultural change etc. – their intellectual capital – synthesised or recombined  into value for the would-be seller or top management. In almost all cases, the answer is a resounding “no”. You are asked to take it on trust.

I asked a serial CEO, and now Board Chair and Senior Adviser to many of the world’s largest private equity firms, how the secrecy helps the private equity investor? He was largely at a loss to explain it apart from avoidance of past PR bloody noses.

Would you allow a surgeon to operate on your heart or the school to teach your child without a pretty clear understanding of how they think and operate, beyond the odd PowerPoint presentation or a few lunches? The time has come for more humility from private equity investors of all shades. That doesn’t require them to diminish their own worth rather to accept that greater transparency upfront is an accelerant to higher levels of trust with their key constituents and superior short and long-term performance.

© James Berkeley 2017.